Poilievre proposes ‘pay-as-you-go’ legislation to curb federal spending | Radio-Canada News

0
3

Conservative leadership candidate Pierre Poilievre said Wednesday that if elected he would introduce new legislation that would require the federal government to offset every dollar of new spending with a cut in something else – a program which he calls a “pay-as-you-go”. approach to budgeting.

Poilievre’s plan is essentially to cap federal spending so it doesn’t go much higher than it currently is. The legislation, if passed, would require the government to find money for new measures from existing budgets, rather than increasing debt and taxes to cover new costs.

See also  How GOP support for decriminalizing abortion faded over the decades

The Tory MP’s campaign said there would be exemptions for expenditure related to “national emergencies such as wars, pandemics and natural disasters”. He also said “spending increases that were previously budgeted for,” such as the annual increase to the Canada Health Transfer and military spending increases, would be exempt.

As it stands, according to the Poilievre campaign, there is “no incentive for anyone in government to eliminate failed or unnecessary programs.”

“Under the pay-as-you-go ministers would not be able to introduce new programs without getting rid of old ones, they would have to seek out rubbish that would otherwise continue to rob taxpayers in perpetuity,” the campaign said in a statement. ‘information. sent to reporters.

See also  Charles Kernaghan, scourge of sweatshops, dies at 74

Poilievre blamed the Liberal government’s big spending budgets for inflation – a charge the government has dismissed, saying the COVID-19 pandemic and war in Ukraine are largely to blame for recent price spikes.

Rise in inflation

Canada’s inflation rate has risen rapidly. According to data released Wednesday by Statistics Canada, the headline inflation rate reached 7.7% in May, a rise largely due to a massive rise in gas prices over the past year.

See also  COVID-19 tracker: Tokyo records 2,004 new cases

The government has defended its COVID-related spending, saying it helped the country avoid economic ruin at the worst of the pandemic.

“The cost of government is driving up the cost of living,” Poilievre said in a statement. “Half a trillion dollars of inflationary deficits have driven up the cost of goods and inflationary taxes have increased the costs for the companies that make those goods. Why are the deficits and taxes so high? To fund increases in colossal expenses.”

Gas costs over $2 a liter at a Vancouver gas station. Conservative Party leadership candidate Pierre Poilievre blamed federal government spending for inflation, while Liberal government maintains COVID-19 and war in Ukraine are largely to blame for rising prices . (Ben Nelms/TSWT)

Poilievre said many families and businesses already follow a pay-as-you-go approach when developing their budgets, and the federal government should too.

“When they spend more on one thing, they spend less on another. A family budget can afford a $2,000 vacation or a $2,000 renovation. Not both. They have to choose,” Poilievre said.

Ideas on Budget Responsibility

Kevin Page, a former Parliamentary Budget Officer (PBO) and expert on federal tax issues, said it’s hard to compare government spending to what Canadians do each month with their own checkbooks.

The federal government’s fiscal firepower simply does not compare to that of the average Canadian household, he said.

“There are limits to good comparisons between government and household budgeting. Governments deal with broad public good issues with different time perspectives and can borrow money [at much lower rates] than private households,” Page told TSWT News.

He said any pay-as-you-go scheme should be flexible to take account of changes in the economy – and that there should be exclusions for spending on capital goods, such as major infrastructure projects, as they represent “much greater returns for the future”. generations. »

“Many economists are generally concerned about government deficit bias and are therefore encouraged to hear about spending rules,” Page said, referring to the tendency of governments to let deficit and public debt levels rise. continually.

“It’s good that Conservative leaders are coming forward with ideas on fiscal responsibility,” he said.

The US Congress has had a pay-as-you-go budgeting approach at different times over the past three decades. The program was successful in the 1990s when the United States eliminated its deficit after pursuing a combination of tax increases and spending cuts.

But the rule has been routinely ignored by lawmakers, with Republicans pushing for uncompensated tax cuts and Democrats introducing new social programs without changes to other so-called “entitlement” programs like pensions and health care for old people.

LEAVE A REPLY

Please enter your comment!
Please enter your name here